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Keeping an Accurate Component Inventory Count

accounting batch planning component inventory inventory inventory management production planning small batch manufacturing

If you are manufacturing your own products, you are going to need an accurate real-time count of your component inventory.

Refining the process will reflect your own methods and madness, but the basic principle is good record keeping.

First, you should know the quantity that you have ordered. Write it down. Preferably in a format that will be searchable and sortable in the future. If you’re lucky, you will have enough products and component purchase orders that it’s not easy to remember off the top of your head how many of each widget you have on hand.

When a truck shows up with a pallet of stuff for you, act like you knew it would be showing up, even if you forgot when you placed the order. (2b, don’t forget when you place orders.) Count the cartons or items on the pallet before the truck driver leaves in order to match them up with the PO quantity. Once they leave, run after them screaming “I’m missing 2 boxes!!!!” When they stop, get out, grumble and count the correct number of cartons, you should apologize for multiplying incorrectly. Once the driver is gone for good, write down the amount that you received, preferably in that same spreadsheet from step one.

You might want to do an initial quality check to see if there are major defects or damage. Don’t spend too much time on it because component quality checks should be built into your production processes.

Find a logical place to store those components for efficient production and then go back to scrolling through Instagram to look at all of the brands that you admire that you assume have this all figured out better than you. They don’t, but stay hungry.

Ok, so you know how many items you have on hand and you are ready to start a production batch. Grab a handful of each component and throw them in the direction of your assembly area. Now keep doing that until you are out of business. If you prefer to stay in business, write down the amount that you plan to use for each production batch and then pull it out of physical inventory in order to move it to the assembly area.

Do a monthly count of inventory and do regular visual checks to confirm that what you physically have is also what your data tells you. And to keep those numbers in line with each other, record every single time that you order, receive, or use a component. Do it right then. Because it’s harder to remember later. Record keeping is key.

Having a good grip on your component inventory is very important for production planning and accounting. All it takes is a system that works in a way that you will use it.

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